Archive for February, 2013

According to a recent survey, digital mapping services have emerged as one of the most powerful growth areas in information technology in South Africa. The survey of 111 corporate and 400 SME decision-makers was conducted by World Wide Worx with the backing of digital mapping provider MapIT.

The survey revealed that three-quarters of South African corporations allocate more than 2% of their IT budgets to mapping services and that last year, 78% of corporates spent more than R50 000 on mapping services with 22% spending over R500 000. A key point to emerge from the survey is the fact that 70% of corporates intend increasing their mapping budgets in 2013 indicating that mapping is being seen to have increased strategic value for corporations.

In contrast digital mapping services are seen as a luxury item by SMEs. Most SMEs are spending below R50 000 of their IT budget on mapping services and just over a third of SMEs allocate more than 2% of their IT budget to mapping services. There is not yet the same strategic value in mapping services for SMEs as there is for corporates; yet despite this, 66% of SMES intend increasing their digital mapping budgets in 2013.

As Arthur Goldstuck of World Wide Worx points out, South Africa is currently experiencing tight economic conditions and if budgets are being increased for mapping services then they have to be of value. If mapping wasn’t working for companies, more budgets would be decreasing.

Both corporate and SME respondents indicated that the key benefits of digital mapping for their companies were enhanced security (fleet tracking), efficiency and productivity with increased competitiveness and cost effectiveness also being seen as important.

The survey also revealed that 47% of South African corporations operate outside South Africa while only 23% of SMEs operate beyond South Africa’s borders.  This implies that companies looking to target corporates with their digital mapping offerings need to be able to offer digital mapping services covering areas beyond South Africa. Traditional mapping services are not enough anymore. SMEs need mapping services with a national focus while corporates need mixed mapping services to meet their needs.

SMEs tend to lag corporations by 2 years when it comes to adopting new technologies, says Goldstuck. A typical SME has an IT budget of R1-million while the typical corporate budget is R30-million. Consequently SMEs need the business case to be very clear before they can adopt new technologies. They need obvious cost-effective solutions.

Location-based marketing, however, is one of those rare technologies where corporates and SMEs are on the same page says Goldstuck. Forty-one per cent of corporates used location based marketing in 2012 with 56% indicating plans to adopt its use in 2013. In contrast 35% of SMEs used location based marketing in 2012 with 54% indicating that they intended using it in 2013. These results clearly illustrate that the business case for location-based marketing services is strong, leading to an inevitable further demand for digital mapping services during 2013.


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